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Companies

I&M, developer halt sale of Sh2bn Athi River Estate

Sunset Boulevard Estate
Sunset Boulevard Estate in Athi River, Machakos County, PHOTO | EVANS HABIL |NMG 

The planned auction of houses in Athi River’s Sunset Boulevard Estate over a defaulted loan has been stopped amid a court order handing reprieve to more than 200 home owners.

Leaky’s Auctioneers, appointed to oversee the sale of 204 houses 390 units on the estate said the principals — I&M Bank and Sunset Boulevard Limited — cancelled the auction planned for Wednesday July 31.

Sunset Boulevard, which built and sold the houses, is said to have failed to repay an undisclosed debt with I&M Bank occasioning the auction notice on Monday in the lender’s bid to recover the funds.

“It has been cancelled by our principals, the sale is not on and I do not have to give details,” Leaky’s Auctioneers said in response to queries.

The estate is valued at more than Sh2 billion and the move comes amid a High Court order issued last month stopping auctioneers from selling off the houses.

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Ogola & Okello Advocates, acting for the developers, had on Monday written to the bank demanding suspension of the advert. They threatened to sue if it was not removed in a last-minute effort to save home owners from looming eviction.

“There was a court order even before the advertisement of the auction, I do not think there is another reason, but you can speak to the bank too,” the law firm said yesterday.

The estate is built on a 20.2-acre piece of land and features a mix of one, two and three bedroom apartments comprising 23 blocks with a market price of between Sh8 million and Sh12 million.

A Mr Jonathan Feldman and Mr Samuel Mirie Gachathi own Sunset Boulevard Limited on a 50-50 per cent basis, according to the Registrar of Companies records.

The cancelled auction of the prime estate on the Nairobi-Mombasa highway underlines the struggles in the real estate sector in recent years.

Central Bank of Kenya in its quarterly report said real estate was the fourth biggest contributor of non-performing loans at Sh43.5 billion out of Sh317.9 billion in total bad loans at end of last September.

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